Written Commentary
SOYBEANS
Soybeans, soymeal, soyoil, new crop corn and wheat traded lower. US stocks were higher. US Dollar was lower. Gold was higher. US central bank now sees the economy growing 6.5% this year, and the unemployment rate falling to 4.5% by year’s end. Soybeans traded lower on improving US and South America weather and in front of US weekly export sales. Sales are est near 0-400 mt vs 350 last week. Seasonally, US exports slow and buyers switch to Brazil. Some report China bought 3 US cargoes his week and are 70 percent covered in May and 60 in June. This suggest they may need to buy 6 mmt. China soymeal prices traded higher as hog producers returned as buyers. A year ago nearby soybeans were near 8.00. Next key issue is USDA March 31 report. May nee a US weather problem to make new highs.
CORN
Corn futures traded mixed. Nearby corn continues to be supported by higher domestic basis, good demand for US exports and talk of higher feed and fuel demand. New crop dropped on increase rains across most of the Midwest adding to soil reserves. EIA weekly ethanol production increased from last week, the largest since December 2020. US ethanol stocks declined from last week and the lowest since November 2020. The cattle on feed report will be released on Friday. COF are estimated 101.5% of year ago levels, with placements at 98.3% of year ago levels. Corn futures were pressured on a WSJ article suggesting the spread of ASF in China could reduce feed use. Rabobank indicated it may take until 2023 to rebuild China’s hog herd to pre-COVID levels. Weekly US corn export sales are est near 300-750 mt versus 395 last week. This weeks China buying of 2.2 mmt US corn should force USDA to increase US export goal and China import guess. This could help tighten US/World stocks to use ratio. Next key USDA report is March 31 acres and stocks report. A yeara go nearby corn was near 3.00. Prices have rallied to near 5.60 on China buying and concern about South America supplies. Market may need a US weather problem to trade over 6.00.
WHEAT
Wheat futures traded lower. Rains across US south plains continues to weigh on prices. Slow demand for US exports also offers resistance. From the Feb high near 6.88 WK has dropped to a low near 6.30. KWK Has dropped from 6.64 to 5.90. MWK has dropped from 6.58 to 6.30. It remains dry across US north plains. Weekly US wheat export sales are est near 150- 500 mt vs 329 last week. Next key USDA report is March 31 acres and stocks report. In April most feel USDA will make few changes to US/World wheat supply and demand. USDA est US 2020/21 wheat carryout near 836 mil bu vs 1,028 ly. HRW stocks near 383 vs 506 ly, SRW 99 vs 105 ly and HRS 258 vs 280 ly. Early guess forUS 2021 wheat is near 1,900 mil bu with a carryout near 790. USDA continues to est World wheat end stocks near 301 mmt vs 300 ly and a crop near 776 mmt vs 764 ly. Some are est World 2021 crop near 780 mmt.
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